DEFINITION of Over And Short

Over and short is an accounting term that describes a discrepancy between reported and examined figures — for example, a discrepancy between sales records and audited statements. If the records show a higher number than the audit, then it is short. These situations can occur at businesses that deal with cash such as banks or retailers if the amount of cash collected differs from the amount its records or receipts show it should have collected. For example, since cashiers or bank tellers give change to customers and complete cash transactions, it's possible that he/she could error and give too much or too little change. If this occurs, the business will have a cash short or cash over situation at the end of the day.


Over and short can be the result of number tampering; however, it is usually the result of simple human error. Making incorrect change or mishandling receipts can each cause this result.

The cash over and short account is an account in the general ledger, a set of numbered accounts for a company's accounting records. The account stores the amount by which the actual ending cash balance differs from the beginning book balance of cash on hand, plus or minus any recorded cash transactions during the period.

The primary users of cash over and short accounts are the cash-intensive retail and banking sectors, as well as those who need to handle petty cash. Petty cash is a small fund of cash kept on hand and maintained by a custodian, a person or entity selected to hold and protect customer funds, for purchases or reimbursements considered too small for formal reimbursement procedures. In cash over or short cases, cash variances should be stored in a single, easily-accessible account. The information is then used to determine why cash levels vary from receipts or other records, and to eliminate these situations by using better procedures, controls and employee training. Thus, the account is used as the basis for a detective control, an accounting term referring to an internal control intended to find problems within a company's processes.

The cash over and short account can also be used for finding fraud, especially when examining activity on specific cash registers or petty cash boxes. For example, fraud may be traced back to the people directly responsible for a cash register or petty cash box.